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Recent Recommendations
Print $1 trillion, and it has got to show up somewhere.
I just got a lecture from a coworker about how I am crazy not to be buying in Silicon Valley right now. Sigh.
CR,
Other than the first graph on corporates, I seriously question the meaningfulness of the rest of it. The Fed and the Treasury have pretty much taken over all the risk in the others, have they not?
Yancey Ward said:
<i>"Other than the first graph on corporates, I seriously question the meaningfulness of the rest of it. The Fed and the Treasury have pretty much taken over all the risk in the others, have they not."</i>
So who owns all this junk-rated paper?
The ratings agencies have had mud on their faces for awhile now. Since they've been caught not doing the job for which they are intentioned, might they in fact now have become CONSIDERABLY more careful and conservative in their views, press releases and opinions?
r
Not sure if in all the posts, this article was mentioned... basically states all insurance companies are considered to be the next AIG...
http://www.ritholtz.com/blog/2009/04/aig-before-cds-there-was-reinsurance/
We also learned from Arvanitis, who worked for AIG during much of the relevant period, that the decision by Hank Greenberg and the AIG board to enter the CDS market was, at best, chasing revenue. No rational examination of the business opportunity, assuming that Greenberg and his directors were acting based on a reasoned analysis, could have resulted in a favorable decision to pursue CDS and other “high beta” risks, at least from our perspective.
In an effort to resolve this conundrum, over the past several months The IRA has interviewed a number of forensic experts, insurance regulators and members of the law enforcement community focused on financial fraud. The picture we have assembled is frightening and suggests that, far from just AIG, much of the insurance industry has been drawn into the world of financial engineering and has thus become part of the problem. Below we present our preliminary findings and invite your comments.
One of the first things we learned about the insurance world is that the concept of “shifting risk” for a variety of business and regulatory reasons has been ongoing in the insurance world for decades. Finite insurance and other scams have been at least visible to the investment community for years and have been documented in the media, but what is less understood is that firms like AIG took the risk shifting shell game to a whole new level long before the firm’s entry into the CDS market.
In fact, our investigation suggests that by the time AIG had entered the CDS fray in a serious way more than five years ago, the firm was already doomed. No longer able to prop up its earnings using reinsurance because of growing scrutiny from state insurance regulators and federal law enforcement agencies, AIG’s foray into CDS was really the grand finale. AIG was a Ponzi scheme plain and simple, yet the Obama Administration still thinks of AIG as a real company that simply took excessive risks. No, to us what the fraud Bernard Madoff is to individual investors, AIG is to the global financial community.
We all know how the stock market is manipulated thanks to Cramer and Jon Stewart on the Daily Show.
Jim Cramer and Jon finally face off
http://www.thedailyshow.com/full-episodes/index.jhtml?episodeId=220533
Jon Stewart, Mouthpiece for the State
Put another way, make "risk free" assets offer a negative real return, and like magic, appetite for risky assets increases.
The government should just mandate the prices for everything. Imagine how much more prosperous we could be.
The Latest from Denninger:
Ticking Financial Nukes (OTC Derivatives)
Micheal, I guess you were at a Mensa meeting or something but CR beat you to it almost 2 weeks ago.
Calculated Risk: Stewart vs. Cramer
The incredibly low yields on "risk free" assets is yet another way savers are being robbed to pay for reckless malinvestment.
The interest income from good borrowers is being used to pay off the losses from bad borrowers. Lost in the middle is the fact that that income was intended for the true owners of the capital: prudent savers.
I wonder how people who live of their interest and dividend incomes are feeling these days.
Obama Impeachment Liquid is up to about $52.20 right now.
So far this isn't much of a problem for the president - currently the chance of impeachment is only about 1% - but things can change quickly.
Remember the formula:
Probability of Impeachment = (Price of O.I.L. - $50)/$200
and so bush and cheney were not impeached why?
rally on baby.....
Maybe we can get a government sponsored cooked employment report tomorrow to go along with our cooked accounting.
Thank you Father for our daily $1 trillion. In Bernanke's name we pray, Amen!
P.S. "The long hot summer" coming to a theatre near you. Buy your bullets ahead of time.
What's next? Your chicks for free?
Morocco Bama said:
<i>What's next? Your chicks for free?</i>
LOL. That's the way you do it.
Control freak Fascists like BO, Bush types, banksters & company are positioning their interests for a complete fascist takeover. The liberal control freak PC language police are re-spinning the terminology now in order to aid and abet BO's agenda.
Thank God at least some Fox News corespondents are going over their handlers heads and telling it like it is. They are finally calling things like Cap & Trade, Cap & Tax because that's what it really is.
ac, the only way oil's going to $200/barrel whilst Obama is in office is either 1)Hyperinflation, or 2)a major geopolitical event such as the bombing of Iran.
New Thread: Former Treasury Assistant Secretary writes: "What was going on?"
http://www.calculatedriskblog.com/2009/04/former-treasury-assistant-secretary.html ( 0 comments ...You could be FIRST! )
I also post comments to an irc channel as they appear on haloscan. Click for a web irc interface: Mibbit IRC client widget (Or join the irc server directly: irc.realize.org:9996 #calculatedrisk)
CRbot is now proud to have the honor of introducing a NEW ERA in CR comments. With the JS-kit, but not below the JS-kit. A independent but integrated solution for all CR fanatics...
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yagij and CRbot: Now with more CRC-ized posting power. You can worship us a little now, mortals.
@Morocco Bama
Good news is that we'll probably have both!
LIBOR is a useless indicator for the foreseeable future, it is clear that governments around the world will not let any of the remaining banks fail (or, more accurately, will not screw any of their counterparties), so the risk of inter-bank lending has disappeared. No one is really worried about it.
MOST of the corporate debt markets are more pure indicators, unless of course you are talking about banks (with FDIC insurance for their debt) or automakers, or probably airlines (anyone doubt they will get bailed out again?), etc...
And of course governments around the world are now talking about buying corporate debt: Europe, Canada, Japan, etc.
Michael, I believe a carbon tax is a prudent idea. The Cap & Trade system is just another racket which will allow the same shenanigans we've seen with CDS. The debate is in how the tax revenue from a crabon tax should be spent.
"Maybe we can get a government sponsored cooked employment report tomorrow to go along with our cooked accounting."
Guaranteed that number will be manipulated. LOTS of discretion in putting that together. Why do you think Gregg wouldn't take the Commerce job?
........ac, the only way oil's going to $200/barrel whilst Obama is in office is either 1)Hyperinflation, or 2)a major geopolitical event such as the bombing of Iran........
.....................plus GoldmanS scam ...........................
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